An old forklift is due for a replacement analysis. It has a current market value $9,000. The market values and operation and maintenance costs for each of the remaining years of service are giver below. The MARR is 12% per year. (a) Complete the table of marginal costs of the old forklift for each of the remaining years of service. (b) If the challenger has a minimum EUAC of $5,536, answer the two additional questions. Forklift (Defender) Year MV at EOY O&M Costs 1 $7,000 $3,000 2 6,000 3,000 3 5,000 3,500 4 3,000 4,500 Click the icon to view the interest and annuity table for discrete compounding when MARR = 12% per year. Answers (a) Fill in the table below. (Round to the nearest dollar.) Year 1 Marginal Cost 2 3 (b) Since Analysis Technique No 2 is applicable here (make sure you know why, Example 5 Module 10), which additional calculation is required before the replacement decision can be made? OA. The minimum marginal cost of the challenger OB. The minimum EUAC of the defender over its remaining life Then, the decision will be made to replace the defender if

An old forklift is due for a replacement analysis. It has a current market value $9,000. The market values and operation and maintenance costs for each of the remaining years of service are giver below. The MARR is 12% per year. (a) Complete the table of marginal costs of the old forklift for each of the remaining years of service. (b) If the challenger has a minimum EUAC of $5,536, answer the two additional questions. Forklift (Defender) Year MV at EOY O&M Costs 1 $7,000 $3,000 2 6,000 3,000 3 5,000 3,500 4 3,000 4,500 Click the icon to view the interest and annuity table for discrete compounding when MARR = 12% per year. Answers (a) Fill in the table below. (Round to the nearest dollar.) Year 1 Marginal Cost 2 3 (b) Since Analysis Technique No 2 is applicable here (make sure you know why, Example 5 Module 10), which additional calculation is required before the replacement decision can be made? OA. The minimum marginal cost of the challenger OB. The minimum EUAC of the defender over its remaining life Then, the decision will be made to replace the defender if

Fundamentals Of Financial Management, Concise Edition (mindtap Course List)

10th Edition

ISBN:9781337902571

Author:Eugene F. Brigham, Joel F. Houston

Publisher:Eugene F. Brigham, Joel F. Houston

Chapter12: Cash Flow Estimation And Risk Analysis

Section: Chapter Questions

Problem 10P: Dauten is offered a replacement machine which has a cost of 8,000, an estimated useful life of 6...

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